Asset Protection

What about my Superannuation?

Usually, it is the trustee of your superannuation fund that decides who received your superannuation death benefits. Superannuation assets, generally do not form part of your Will. Superannuation is owned by the superannuation fund trustee, who has to act according to the trust deed of the fund and the Superannuation laws.

Superannuation law generally requires death benefits to be paid to those beneficiaries that the trustee considers to be most needing of it.

In a standard family situation where there is no antagonism between potential dependents, this situation may not be an issue. However, in a blended family where the deceased may have had previous marriages and children from both marriages, this can lead to potential conflicts between beneficiaries. Also, the control of assets may be in the hands of one family, with the potential for children from the other marriage not factoring in the ultimate distribution. However, there are strategies you can put in place to guard against these types of situations.

Can my Will be challenged?

Always remember it is your Will, and you have the right to leave your assets to the people you choose. However, it is possible that your Will might be challenged, if you do not leave assets to these people that the law believes you should leave your assets to. In simple terms, you should leave assets to your family, except where that family member does not have needs, or has done something to effectively dis-entitle them to your assets.

This is a very complicated area of the law and we would recommend that you obtain specialised advice if you are considering leaving someone out of your Will.

reviewing Superannuation nominations (however, the final beneficiaries of superannuation are a matter for the trustee of the superannuation fund and any claimants);

reviewing life insurance policy ownership;

considering Department of Social Security entitlements;

considering potential capital gains tax liabilities;

considering the financial and personal position of proposed beneficiaries.

Failure to undertake this analysis may result in severe unintended consequences, if your Will is prepared where you believe the Will, will deal with all assets including Non-Will assets.

Summary

Regular review of your Will and a close association with your financial adviser and accountant is essential to ensure that your Will remains appropriate in an environment of changing laws and personal circumstances.

Types of Wills:

Basic Will

With solid, basic estate planning advice, multiple bequests, and multiple beneficiaries, including spouse, children, grandchildren and others. Advice on a number of possibilities and traps that arise and circumstances under which you should change your will. Advice to assist you to avoid intestacy, on whether your will may result in a claim on your estate and if so what steps you should now take to deal with the possibility of that claim.

Complex Will

Significant advice as to make up of executors (including professional executors), trustees, guardianship of children, complex families, children with difficult relationships, advice in relation to the process for estate handling upon death and advice on the procedure for a Grant of Probate, advice on the effect of bankruptcy of the beneficiaries, CGT and other taxes, wills challenges, family company and business issues. General advice in relation to the possible need for financial planning advice.

Testamentary Trust Will

Testamentary Trusts set up through your wills, explanation on how a testamentary trust works and the benefits it offers, unlike ordinary wills. In addition to the issues covered in all of the other options available we will undertake a comprehensive review of your needs, review current taxation, superannuation and other relevant legislation which would impact on the beneficiaries of your estate as it is possible to establish trusts on your death which minimize income tax and capital gains taxes and superannuation death benefit taxes. Further strategies are considered and put in place to potentially defeat creditors claiming against your estate and your beneficiaries for the benefits you leave to those people you love. An additional advantage is the minimization of claims by spouses in the event of marriage breakdown and the insertion of adjustment clauses in your will to minimize potential disputes between your children. Finally, strategies can be put in place to ensure that your superannuation death benefits pass to your beneficiaries rather than in accordance with the discretion of the trustee of your superannuation fund.

Transfer of Ownership and Control

Consideration is given to the following questions:

How will ownership and/or control of each asset be transferred?

Is there a current, valid Will in place?

Who are the beneficiaries for the life insurance and superannuation proceeds?

Are there joint ownership structures?

Is the estate plan tax effective? i.e. minor children etc.

Does a beneficiary require protection? i.e. divorce, bankruptcy etc.

Timing

The timing of asset transfers is also a critical component of any estate plan. For instance:

Age at which minors should receive any inheritance;

Should assets be sold, if so, when?

Who should sell them? The estate executor or the beneficiary;

Repayment of personal and/or business debts.

Before We Begin -The Preliminary Step

Before we proceed to engagement, it is important that you ask and understand the following.

Do you know what is meant by estate planning?

How it might apply to your family and/or business?

How it fits in with your overall financial plan?

The nature and scope of the estate planning service we offer.

Compliance and Regulatory Matters

Client confidentiality – any information provided to us will not be disclosed to any third party without your consent.

Common law duty of care – we endeavour to provide best practice advice for you to reasonably act on this information and advice, given your circumstances.

Contract law – our engagement will be clear and concise outlining the nature and extend of our estate planning service.

Consumer protection legislation – at all times we will adhere to Division 2 of Part 2 of the ASIC Act 1989 that applies to financial planners.

All strategies and information provided on this website are general advice only which does not take into consideration any of your personal circumstances. Please arrange an appointment to seek personal financial and taxation advice prior to acting on this information.